YAHUD, Israel, November 29, 2011 /PRNewswire/ --
Magal S3 Ltd. (NASDAQ GMS: MAGS, TASE: MAGS) today announced its financial results for the three month period ended September 30, 2011. Management will hold an investors' conference call later today, at 10:00 a.m. Eastern Time and 5:00 p.m. Israel time, to discuss the results.
THIRD QUARTER 2011 RESULTS SUMMARY
Revenues for the third quarter of 2011 increased 107% to a record $27.7 million. This is compared with $13.4 million, of revenues in the third quarter of 2010.
Gross profit in the quarter was $13.1 million, or 47.2% of revenues. This is an increase of 142% compared to gross profit of $5.4 million, or 40.4% of revenues in the third quarter of 2010.
Operating profit in the quarter was $5.6 million compared to an operating loss of $0.8 million in the third quarter of 2010. During the quarter, the Company recorded a $2.3 million arbitration award arising from the unwarranted cancellation of a contract entered into in 2006 with a customer in Eastern Europe.
Financial income in the quarter amounted to $1.2 million compared to financial income of $97,000 in the third quarter of 2010.
The company reported a tax benefit of $199,000 in the quarter compared with a tax expense of $66,000 in the third quarter of 2010.
Net income in the quarter was $7.1 million. This is compared with a net loss of $799,000 in the third quarter of 2010.
Net income per basic and fully diluted share in the third quarter of 2011 was $0.61, compared with a net loss per basic share of $0.08 in the same period last year.
Cash and cash equivalents as of September 30, 2011, were $33.8 million, or $2.14 per basic share, compared with $22.4 million or $2.12 per basic share as of June 30, 2011.
FIRST NINE MONTHS 2011 RESULTS SUMMARY
Revenues in the first nine months of 2011 were $54.9 million, an increase of 59% compared with $34.6 million as reported in the first nine months of 2010. Net profit in the nine month period amounted to $5.6 million compared with a net loss of $4.7 million, in the same period last year. Net income per basic and fully diluted share in the nine month period amounted to $0.52, compared with a net loss per basic share of $0.45 in the same period last year.
Commenting on the results, Mr. Eitan Livneh, President and CEO of Magal, said, "We are very proud of our achievements over the past year which has led to these outstanding quarterly results, the highest in Magal's history. The in excess of $80 million in project wins that we have announced over the past year, as well as our execution on these projects which are in various stages of delivery, contributed to the strong improvement in revenue and profit."
Continued Mr. Livneh, "I believe Magal has successfully transitioned to the new path we initiated over the past two years, and the fruits of our efforts are finally visible in the outstanding results of the quarter. Following our successful rights offering and significant cash generation in the quarter, we have a very healthy balance sheet and strong financial position. This enables us to better compete for larger scale projects and pursue new opportunities. At the same time, we continue to see strong market demand for our services, particularly in global developing regions, and we believe our momentum will continue into the coming quarter and beyond."
INVESTORS' CONFERENCE CALL INFORMATION:
The Company will host a conference call later today, November 29, 2011, at 10:00 a.m. Eastern Time and 5:00 p.m. Israel time.
To participate, please call one of the following teleconferencing numbers. Please begin placing your calls at least 10 minutes before the conference call commences. If you are unable to connect using the toll-free numbers, please try the international dial-in number.
US: 1-888-668-9141 ; Israel: 03-918-0609 ; UK: 0-800-917-5108 ; Intl.: +972-3-918-0609
A replay of the call will be available from the day after the call for three months. The link to the replay will be accessible from Magal's website at: http://www.magal-s3.com.
ABOUT MAGAL S3
Magal S3 is a leading international provider of security, safety and site management solutions and products (NASDAQ: MAGS).
Over the past 40 years, Magal S3 has delivered tailor-made solutions to hundreds of satisfied customers in over 80 countries.
Magal S3 offers a broad portfolio of unique products used to protect sensitive installations in some of the world's most demanding locations and harshest climates. This portfolio covers the following three categories:
- Perimeter Intrusion Detection Systems (PIDS) - a variety of smart barriers and fences, fence mounted detectors, virtual gates, buried and concealed detection systems
- Close Circuit TV (CCTV) - a comprehensive management platform with a leading Intelligent Video Analysis (IVA) and Video Motion Detection (VMD) engine
- Physical Security Information Management (PSIM) - an open site management system that enhances command, control and decision making during both routine operations and crisis situations
This press release contains forward-looking statements, which are subject to risks and uncertainties. Such statements are based on assumptions and expectations which may not be realized and are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, financial and otherwise, may differ from the results discussed in the forward-looking statements. A number of these risks and other factors that might cause differences, some of which could be material, along with additional discussion of forward-looking statements, are set forth in the Company's Annual Report on Form 20-F filed with the Securities and Exchange Commission.
** Financial Tables to Follow **
MAGAL S3 LTD. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME (All numbers except EPS expressed in thousands of US$) Nine months Three months Ended September 30, Ended September 30, % % change 2011 2010 change 2011 2010 Revenue $54,860 $34,565 58.7 $27,660 $13,362 107.0 Cost of revenue 30,805 21,885 40.8 14,608 7,969 83.3 Gross profit Operating expenses: 24,055 12,680 89.7 13,052 5,393 142.0 Research and development, net 2,918 3,064 (4.8) 1,000 910 9.9 Selling and marketing 12,382 7,850 57.7 5,645 3,306 70.8 General and administrative 6,251 5,864 6.6 3,073 1,989 54.5 Other income (see above) (2,310) - (2,310) - Total operating expenses 19,241 16,778 14.7 7,408 6,205 19.4 Operating income (loss) 4,814 (4,098) 5,644 (812) Financial expense (income), net (829) 562 (1,227) (97) Income (loss) before income taxes 5,643 (4,660) 6,871 (715) Income tax expense (benefit) 55 46 (199) 66 Net income (loss) 5,588 (4,706) 7,070 (781) Less: net income (loss) attributable to non-controlling interest - (19) - (18) Net income (loss) attributable to Magal shareholders 5,588 (4,725) 7,070 (799) Basic and diluted income (loss) per share from continuing operations $0.52 $(0.45) $0.61 $(0.08) Number of basic and diluted shares 10,794,696 10,396,548 11,579,325 10,396,548 Nine months ended Three months ended June 30, September 30, 2011 2010 2011 2010 % % % % Gross margin 43.8 36.7 47.2 40.4 Research and development, net as a % of revenues 5.3 8.9 3.6 6.8 Selling and marketing as a % of revenues 22.6 22.7 20.4 24.7 General and administrative as a % of revenues 11.4 17.0 11.1 14.9 Operating margin 8.8 (11.9) 20.4 (6.1) Net margin 10.2 (13.7) 25.6 (6.0)
MAGAL S3 LTD. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (All numbers expressed in thousands of US$) September 30, December 31, 2011 2010 CURRENT ASSETS: Cash and cash equivalents $ 33,830 $ 16,596 Short term bank deposit 408 - Restricted deposit 4,444 2,692 Trade receivables 9,841 15,106 Unbilled accounts receivable 3,295 2,927 Other accounts receivable and prepaid expenses 8,828 2,417 Deferred income taxes 512 474 Inventories 11,492 10,340 Total current assets 72,650 50,552 Long term investments and receivables: Long-term trade receivables 1,567 1,568 Long-term bank deposits 60 2,196 Severance pay fund 2,127 2,148 Total long-term investments and receivables 3,754 5,912 PROPERTY AND EQUIPMENT, NET 6,743 6,794 OTHER INTANGIABLE ASSETS, NET 203 213 GOODWILL 2,021 2,026 Total assets $85,371 $65,497 CURRENT LIABILITIES: Short-term bank credit $4,849 $9,327 Current maturities of long-term bank debt 33 503 Trade payables 8,183 3,937 Customer advances 10,351 2,428 Other accounts payable, accrued expenses and customer advances 10,522 7,745 Total current liabilities 33,938 23,940 LONG-TERM LIABILITIES: Long-term bank debt 48 50 Major shareholder loan - 9,907 Deferred income tax 208 190 Accrued severance pay 3,341 3,394 Total long-term liabilities 3,597 13,541 SHAREHOLDERS' EQUITY Ordinary shares of NIS 1 par value - Authorized: 19,748,000 shares at December 31, 2010 and 39,748,000 shares at September 30, 2011; Issued and outstanding: 10,396,548 shares at December 31, 2010 and 15,819,822 shares at September 30, 2011 4,813 3,225 Additional paid-in capital 64,858 49,971 Accumulated other comprehensive income 4,463 5,075 Foreign currency translation adjustments (Company's stand alone financial statements) 1,770 3,400 Accumulated deficit (28,068) (33,655) SHAREHOLDERS' EQUITY 47,836 28,016 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $85,371 $65,497
For more information:
Magal S3 Ltd.
Eitan Livneh, CEO
Assistant: Ms. Elisheva Almog
CCG Investor Relations
Ehud Helft/Kenny Green
Tel: (US) +1-646-201-9246
Int'l dial: +972-3-607-4717
SOURCE Magal Security Systems Ltd
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